SINGAPORE, May 25 (Reuters) - The yield on U.S. Treasury bills maturing in early June climbed further above 7% on Thursday, after ratings agency Fitch put the country on credit watch for possible downgrade.

Fitch put the United States' "AAA" rating on a negative watch in a precursor to a possible downgrade should lawmakers fail to raise the amount that the Treasury can borrow before it runs out of money - a deadline expected as soon as next week.

Bid-ask spreads were wide in early Asia trade. The yield on Treasury bills maturing on June 1, which the Treasury says is when it will run out of money, jumped more than 18 basis points to a fresh high of 7.4268%. That is much higher than the current Fed funds rate of around 5.1%.

Ten-year yields rose marginally to 3.75%.

(Reporting by Tom Westbrook; Editing by Muralikumar Anantharaman)